DEFINITION of 'Discretionary Order'

An order giving a broker the ability to decide when to buy/sell securities at the best possible price for the customer. Some discretionary orders place restrictive terms to limit the amount of discretion the broker has.

BREAKING DOWN 'Discretionary Order'

When placing a discretion order, the investor is giving limited discretion to the broker and allowing for the timing of buying/selling to be decided by the trader.

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RELATED FAQS
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    Learn how a limit order is placed, the types of stocks it is most useful for and the specifications placed with it to suit ... Read Answer >>
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    Learn how brokers have the sole discretion to determine which customers can open margin accounts, and understand the rules ... Read Answer >>
  3. What's the difference between a market order and a limit order?

    Buy and sell trades with market orders at the present stock price and execute limit orders if the stock price falls within ... Read Answer >>
  4. My broker just sold securities out of my account without my permission. Is this legal?

    Your broker's actions are not legal unless he or she sold the securities under certain conditions. Let's look at the two ... Read Answer >>
  5. Why do limit orders cost more than market orders?

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